Subcontracting depot repair for intercompany trade - process and setup

Operations or activities are carried out by one financial entity on behalf of another financial entity and costs are incurred, for example, material or labor, for these operations or activities.

Work center WCA1 and Service Department SDA2 are entities of organization A. Work center WCA1 belongs to financial company FA1 and Service Department SDA2 belongs to financial company FA2. Both financial companies are also part of organization A.

To fulfill a maintenance sales order for an external customer, Service Department SDA2 instructs Work center WCA1 to carry out some repairs for item R1 on behalf of the external customer. SDA2 invoices the external customer. As compensation for the costs incurred, WCA1 invoices SDA2 for materials and labor at actual costs.

This scenario applies to maintenance sales orders, and uses a parent and one or more child intercompany trade orders. On the parent order, WCA1 is the selling entity and SDA2 is the buying entity. The parent order also displays the main item, the overall price origin, and the total cost of goods sold (COGS) and revenues of the child orders.

A child intercompany trade order displays a repair item, labor costs, or hours booked by a service engineer. If different items are used to repair a main item, a child order is created for each repair item.

The related work order displays the responsible work center and overall information such as the item to be repaired. The work order is linked to various resource lines such as material resource lines, or hours accounting lines.

When the related work order is saved, the parent intercompany trade order is created. The child intercompany trade orders are created when the work order lines are saved.

The transaction lines are created when the related work order is closed. To close the work order, the selling and buying parts of the parent and child intercompany trade orders must be approved.

In subcontracting depot repair scenarios with price origin time and material, the items - materials - used to repair the main item can be invoiced by the work center to the service department. This is displayed on child intercompany trade orders. For these child orders, the scenario is Internal Material Delivery.

For the subscenarios Labor and Internal Material Delivery, the price origins are:

For the subscenario Other, the price origins are: